Bitwise shifts Bitcoin, Ethereum futures ETFs to dynamic crypto and treasuries strategy Bitwise shifts Bitcoin, Ethereum futures ETFs to dynamic crypto and treasuries strategy
Bitwise explained that the new funds are designed to take advantage of market momentum while offering protection during bearish conditions
2 min read
Updated: Oct. 4, 2024 at 7:50 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Bitwise plans to shift three of its Bitcoin and Ethereum futures ETFs from their current long-only strategies to ones that alternate between crypto and US Treasuries, according to an Oct. 4 statement.
The company’s crypto futures ETFs — including the Bitwise Bitcoin Strategy Optimum Roll ETF (BITC), the Bitwise Ethereum Strategy ETF (AETH), and the Bitwise Bitcoin and Ether Equal Weight Strategy ETF (BTOP) — will be rebranded to the Bitwise Trendwise Bitcoin and Treasuries Rotation Strategy ETF (BITC), the Bitwise Trendwise Ethereum and Treasuries Rotation Strategy ETF (AETH), and the Bitwise Trendwise BTC/ETH and Treasuries Rotation Strategy ETF (BTOP), respectively.
The fund manager expects the adjustment to occur by Dec. 3.
Notably, this move comes during the same week that the asset manager applied to the US Securities and Exchange Commission (SEC) for a spot XRP ETF.
Bitwise Trendwise ETFs
According to the statement, these ETFs will adjust their exposure to crypto or US Treasuries, depending on market conditions. During positive market trends, they will focus on crypto investments, while during downturns, they will shift to US Treasuries.
Bitwise explained that the Trendwise strategy improves risk-adjusted returns by taking advantage of market momentum while offering protection during bearish conditions. The strategy relies on a proprietary signal that monitors the 10- and 20-day exponential moving averages (EMA) of crypto prices.
So, when the 10-day EMA surpasses the 20-day EMA—signaling upward momentum—the funds will invest in crypto. If the situation reverses, the funds will rotate into US Treasuries.
Bitwise CIO Matt Hougan explained that this strategy reflects broader trends in asset management. He stated:
“The new Trendwise strategies capitalize on that momentum through a trend-following strategy that rotates between crypto and Treasuries exposure based on market direction. The goal is to help minimize downside volatility and potentially improve risk-adjusted returns.”
Meanwhile, Bitcoin market analyst Joe Consorti praised the development, stating:
“This is massive news for bitcoin as a macro asset. US Treasuries are the preferred asset for all of the world’s financial institutions. Adding bitcoin to a rotating investment vehicle will juice UST returns and be an enticing diversifier for UST-heavy balance sheets.”
These changes will not impact the funds’ expense ratios or tax treatment, so current investors will not need to take any action.
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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Bitwise Asset Management pioneered the first cryptocurrency index fund and is the leading provider of rules-based exposure to the cryptoasset space..